Posts Tagged ‘Gary Gensler’

Breaking news: Regulators are (re)discovering that maybe speculation CAN be excessive

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Breaking news: Regulators are (re)discovering that maybe speculation CAN be excessive

BubblesCourtesy of TIME, by Justin Fox writing at the Curious Capitalist Blog

The announcement this morning (pdf!) by Commodity Futures Trading Commission chairman Gary Gensler that his agency is considering imposing limits on the size of trades by energy futures speculators may amount to something of a landmark (or turning point, or whatever portentous phrase you prefer) in Washington’s relationship to financial markets.

Gensler justified the move as part of the CFTC’s duty "to eliminate, diminish or prevent the undue burdens on interstate commerce that may result from excessive speculation." This is a big deal because, for the past 40 years, financial regulators have increasingly gravitated toward the position that speculation can never be excessive. As an official in the Clinton Treasury Department in the late 1990s, in fact, Gensler helped fight off efforts by then-CFTC chairman Brooksley Born to rein in what she felt was excessive speculation in over-the-counter derivatives markets. Yet now here he is proposing new rules to rein in oil and natural gas speculators.

The roots of the benign attitude toward speculation that prevailed in recent decades can be found (among other places I’m sure, but those places aren’t on my bookshelf) in a famous 1953 paper by Milton Friedman on "The Case for Flexible Exchange Rates" (which in turn can be found in his book Essays in Positive Economics). The basic thrust of the paper—that anything but a permanently fixed exchange rate or a free-floating one is inherently destabilizing—still holds up reasonably well. But I’m not so sure about this passage on speculation:

People who argue that speculation is generally destabilizing seldom realize that this is largely equivalent to saying that speculators lose money, since speculation can be destabilizing in general only if speculators on the average sell when the currency is low in price and buy when it is high.

Maybe it’s the "in general" that’s the problem here. On average and over time, the argument may be right. But there are surely extended periods during which price bubbles persist—as in the oil futures market last year—and speculators make lots of money by betting on further price increases, thus destabilizing markets. So Gensler is proposing rules that would


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Phil's Favorites

The Myth Of The "Great Cash Hoard" Of 2019

Courtesy of Lance Roberts, RealInvestmentAdvice.com

Tell me if you heard this one lately:

“There’s a trillion dollars in cash sitting on the sidelines just waiting to come into the market.” 

No.

Well, here it is directly from the Wall Street Journal:

“Assets in money-market funds have grown by $1 trillion over the last three years to their highest level in around a decade, according to Lipper data. A variety of factors are fueling the flows, from higher money-market rates to concerns over the health of the 10-year economic expansion and an aging ...



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Zero Hedge

The Myth Of The "Great Cash Hoard" Of 2019

Courtesy of Lance Roberts, RealInvestmentAdvice.com

Tell me if you heard this one lately:

“There’s a trillion dollars in cash sitting on the sidelines just waiting to come into the market.” 

No.

Well, here it is directly from the Wall Street Journal:

“Assets in money-market funds have grown by $1 trillion over the last three years to their highest level in around a decade, according to Lipper data. A variety of factors are fueling the flows, from higher money-market rates to concerns over the health of the 10-year economic expansion and an aging ...



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Kimble Charting Solutions

Are Bank Stocks Sending Bullish Message To Investors?

Courtesy of Chris Kimble

Just as the health of the banking sector is a big deal to the economy, it’s equally important to the S&P 500 (SPY) and broader stock market.

Although the bull market has grinding higher, it’s awaiting confirmation from the banks and banks stocks.

Today’s chart is of the S&P 500 Bank ETF (KBE) and shows how the banks are at an important juncture in time and price.

KBE (the bank ETF) is testing the upper end of a falling channel, offering bulls an opportunity for a breakout – see point (2).

The banks were at a similar juncture nearl...



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Insider Scoop

KalVista Shares Sink On Failed Mid-Stage Study Of Diabetic Macular Edema Drug

Courtesy of Benzinga

Shares of thinly-traded micro-cap biotech Kalvista Pharmaceuticals Inc (NASDAQ: KALV) are seen moving to the downside Monday.

What Happened

Massachusetts-based KalVista, which focuses on developing small molecule protease inhibitors, said a Phase 2 study that evaluated its KVD001 in patients with diabetic macular edema, who were poor responders to previous treatment with anti-VEGF t...



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Digital Currencies

The Road To Retirement: Millennials Put Their Faith In Bitcoin But Goldman Says Go With Gold

Courtesy of ZeroHedge View original post here.

"Drop Gold" - the ever-present tagline of Grayscale's Bitcoin Trust TV commercial - appears to be working its magic on a certain cohort of society.

2019 has seen assets under management in GBTC soar...

Source: Bloomberg

And for Millennials, according to the lates...



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Lee's Free Thinking

Chart Shows the Fed Ramping Up Not QE - Funding Almost All Treasury Issuance

 

Chart Shows the Fed Ramping Up Not QE – Funding Almost All Treasury Issuance

Courtesy of Lee Adler, Wall Street Examiner 

The Fed is ramping up “Not QE” .

The Fed bought $2.2 billion in notes today in its POMO, “not QE,” operations. Actually $2.15 billion because they sold back a whole $50 million. Must have been a little glitch in the force.

This brings the Fed’s total outright purchases of Treasuries to $170 billion since it started Not QE, on September 17.

It also did $107 billion in gross new repo loans to Primary Dealers to buy Tre...



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Chart School

Silver stock taking the sector higher

Courtesy of Read the Ticker

As the US economy begins to show late cycle characteristics like: GDP slowing, higher inflation, higher wage costs, CEO confidence slump. 

Previous Post: Gold Stocks Review

The big players in the market are looking for the next swing off good value lows. This means more money is finding it way into the gold and silver sector, and it is said gold and silver stocks actually lead the metal prices.

The cycle below shows prices are ready to move in the months ahead (older chart re posted).


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Members' Corner

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

 

Sacha Baron Cohen Uses ADL Speech to Tear Apart Mark Zuckerberg and Facebook

By Matt Wilstein

Excerpt:

Sacha Baron Cohen accepted the International Leadership Award at the Anti-Defamation League’s Never is Now summit on anti-Semitism and hate Thursday. And the comedian and actor used his keynote speech to single out the one Jewish-American who he believes is doing the most to facilitate “hate and violence” in America: Facebook founder and CEO Mark Zuckerberg.

He began with a joke at the Trump administration’s expense. “Thank you, ADL, for this recognition and your work in fighting racism, hate and bigotry,” Baron Cohen said, according to his prepared...



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The Technical Traders

VIX Warns Of Imminent Market Correction

Courtesy of Technical Traders

The VIX is warning that a market peak may be setting up in the global markets and that investors should be cautious of the extremely low price in the VIX. These extremely low prices in the VIX are typically followed by some type of increased volatility in the markets.

The US Federal Reserve continues to push an easy money policy and has recently begun acquiring more dept allowing a deeper move towards a Quantitative Easing stance. This move, along with investor confidence in the US markets, has prompted early warning signs that the market has reached near extreme levels/peaks. 

Vix Value Drops Before Monthly Expiration

When the VIX falls to levels below 12~13, this typically v...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

Reminder: We are available to chat with Members, comments are found below each post.

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Promotions

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